The use of total quality management in the adaptation of quality of delivery: a case study in private higher education

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The use of total quality management in

the adaptation of quality of delivery: A

case study in private higher education

L Venter

orcid.org/0000-0003-4344-7788

Mini-dissertation accepted in partial fulfilment of the requirements

for the degree

Master of Business Administration

at the North-West University

Supervisor: Dr Nelda Mouton

Graduation: May 2020

Student number: 31353339

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DECLARATION

I, Liana Venter, declare that this research dissertation titled The use of total quality management in the adaptation of quality of delivery: A case study in private higher education and the work presented therein are my own, and generated by me as a result of my own original research. It is submitted in partial fulfilment of the requirements of the degree of Master of Business Administration at the Business School of North-West University. To the best of my knowledge and belief, no material has been previously published or written by another person except where due references are made in this mini-dissertation.

_______________________ Liana Venter

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PREFACE AND ACKNOWLEGEMENTS

All praise to God almighty, for blessing me with this opportunity to study and develop into the person He has created me to be. Throughout my life, and again with this journey of knowledge creation and development, He bestowed love and mercy upon me and kept me strong in difficult times.

I want to thank my supervisor, Dr Nelda Mouton, for her time, patience and especially encouragement throughout the journey. For the long hours she had to read through all my attempts. I would not have been able to complete this without her support.

I would like to thank my family for their support and encouragement and always being there for me. I would not have been able to complete my studies if it were not for them, and I am blessed to have them in my life.

I would lastly like to thank the management team at Akademia, for the opportunity and support in encouraging further studies and making this dream a reality for me.

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ABSTRACT

Higher education forms part of the service sector of the economy and service quality is seen as a differentiating factor and contributor to competitive advantage for private higher education institutions. Limited research exists regarding the effectiveness of the implementation of service quality in private higher education to ultimately result in customer satisfaction. The aim of this research is to gain an understanding of whether service quality and total quality management principles are used in a private higher education institution to gain a competitive advantage.

A qualitative research methodology is used in this research study and the framework through which data was collected was an exploratory case study. The data was collected from multiple sources of evidence and analysed and developed into themes and subcategories via in vivo coding and ATLAS.ti software.

In terms of the expected contribution of the study, the higher education industry was specifically chosen as one important for knowledge creation and economic growth in South Africa. The biggest contribution of the research will be to the management team of Akademia on how it can use quality of delivery in the form of total quality management processes. This will allow the private higher education institution to gain a competitive advantage through the distinguished service it can provide. Total quality management and the regulatory framework are to be used as moderators in ensuring that student satisfaction is achieved.

Keywords: higher education, private higher education, total quality management, business-driven, value proposition, competitive advantage

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LIST OF TABLES

Table 1: Accreditation criteria ... 16

Table 2: Service quality dimensions relevant to private higher education ... 25

Table 3: Difference between research paradigms ... 31

Table 4: Sampling techniques ... 38

Table 5: Four design test ... 40

Table 6: Summary of the participants involved in the study ... 49

Table 7: Codes and code frequency ... 50

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Table 9: Student response to change ... 63

Table 10: Dimensions of service quality delivery ... 64

LIST OF FIGURES

Figure 1: Legislative framework for private higher education institutions ... 15

Figure 2: A conceptual framework to approaches in quality assurance ... 18

Figure 3: Stakeholders in the higher education landscape ... 21

Figure 4: Dimensions of quality in higher education ... 24

Figure 5: Steps in the research process ... 33

Figure 6: Data-analysis process followed ... 44

Figure 7: Conceptual illustration of key themes ... 51

Figure 8: Summary of terms under the theme of compliance ... 54

Figure 9: Summary of terms under the theme of institutional offering ... 60

Figure 10: Summary of terms under the theme of quality management ... 66

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LIST OF ABBREVIATIONS

CHE Council on Higher Education

DHET Department of Higher Education and Training

HE Higher Education

HEI Higher Education Institution

HEQC Higher Education Quality Committee

LMS Learning Management System

NQF National Qualifications Framework SAQA South African Qualifications Authority

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LIST OF DEFINITIONS

Higher education: Higher education is defined as “all learning programmes which lead to qualifications that meet the requirements of the Higher Education Qualifications Subframework” (Council on Higher Education [CHE], 2007).

Higher education institutions: The Higher Education Act 101 of 1997 refers to a higher education institution as:

“any institution that provides higher education on a full-time, part-time or distance basis and which is-

(a) established or deemed to be established as a public higher education institution under the Act;

(b) declared as a public higher education institution under the Act; or

(c) registered or conditionally registered as a private higher education institution under this Act.

Total quality management: Total quality management is achieved when an organisation manages all areas within the organisation in such a way that all departments deliver a quality service to customers (Heizer et al., 2017:257).

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CHAPTER 1: CONTEXTUALISATION OF THE STUDY

1.1 INTRODUCTION

Globally, higher education (HE) has experienced major changes over the last decade due to technological developments, critical political and economic challenges experienced, changing student needs and an increase in the demand for education overall. In South Africa, the need for quality HE also exists, with an increase in the number of learners that are seeking post-school education. The challenge for higher education institutions (HEIs) in this service sector is to attract students to their institutions through relying on their competitive advantage and market positioning. Van Schalkwyk (2018:3) highlights the growth experienced in this service sector globally and its contribution to the gross domestic product of countries. This results in service quality becoming a key driver for competitiveness and improving market positioning.

There have been several studies done in the past decade on service quality, exploring various aspects and dimensions of service quality (Goetsch & Davis, 2014:159; Khan

et al., 2018:182; Manatos et al., 2017:159). However, very few studies have been done

on service quality as a competitive advantage in HE, and the specifically in South Africa. This study will look into service quality in HE as a differentiating factor and contributor to competitive advantage for private HEIs within a regulated and competitive environment. The focus was on Akademia as private HEI that offers all programmes through a distance mode of delivery with the support of technology and scheduled contact sessions throughout 12 study centres in South Africa and one in Namibia. The South African HE sector is highly regulated, especially for private HEIs, and both the registration of these institutions and the accreditation of programmes offered by the institutions are mandatory for the institutions to be able to operate within the sector. Through the registration and accreditation process that is followed minimum standards in terms of programme offerings are adhered to by all private providers as envisioned by the regulators.

The goal of this chapter is to provide background information on the HE sector and the rationale for the study. The problem statement and objectives of the study are provided together with the methodology and research design that was used to achieve its

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objectives. The limitations of the study and chapter outline of the thesis will also be provided.

1.2 BACKGROUND

The South African post-school education and training sector includes all HEIs (public and private), technical and vocational colleges and public adult learning centres (Department of Higher Education and Training [DHET], 2013:1). All HEIs operate within the university sector, with public HEIs being known as “universities” and private institutions only allowed to be called “higher education institutions” and not universities.

1.2.1 Higher education context

HE has a long history – from beginning as elite institutions for only the selected few to becoming more accessible to a wider population over time (CHE, 2004a:15). Globally, the HE landscape is still undergoing major changes (Lichy & Birch, 2015:1) and the sector is facing various challenges, which is the case for the South African HE sector as well. In the South African context, HE can be further divided into public and private HE, operating within the same regulatory environment, but with the distinguishing factors being found in how they secure funding, how they are structured and how they operate. There are currently 102 fully registered private HEIs and 26 provisionally registered private HEIs in South Africa (DHET, 2018).

1.2.2 Private higher education in South Africa

Private HE plays an important role in the HE landscape, especially in South Africa where the demand for HE education is greater than what public HE can provide and where greater access to HE is needed (DHET, 2013:22). This creates the opportunity for private HEIs to fill the gap.

Private HEIs are part of a highly regulated environment, which poses challenges for these institutions to fully function as businesses (CHE, 2007:174). Where a business can adapt to the changing needs of customers, private HEIs cannot necessarily react faster to market and consumer changes than public HE institutions, as the accreditation process is lengthy and requires the same rigour for private and public HE institutions. Private HEIs

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thus have to find alternative ways of ensuring they are the preferred choice when students enrol for their journey in knowledge creation.

From the perspective of private HEIs, service quality should be a key focus area in their core business for them to become customer-driven institutions (Goetsch & Davis, 2014:13), as well as to gain a competitive advantage over other institutions and improve their market positioning (Van Schalkwyk, 2018:3). For private HEIs that are business-driven, the students are important stakeholders that in effect become their business partners as they move from just being seen as students, to being seen by the institution as customers. This entails ensuring that the institution offers what their customers demand and therefore know what the needs of their customers are and what they value. Private HE was mostly unregulated until 1997 when the Higher Education Act was published, which, through Section 53, regulates private HE to ensure academic offerings by private HEIs adhere to standards of quality (Ellis, 2012:17). Armstrong (2014:5) argues that due to the lack of tools to measure the quality of outcomes in HE, the regulation of the resources and processes used to create quality need to be rigorously monitored externally. Ellis and Steyn (2014:445) also share the view that the decision to regulate private HEIs in South Africa was to ensure quality in HE, whereas Sallis (2014:7) argues that compliance to regulations are important for quality control, but that quality improvement is more important and should be developed in HEIs – it cannot be merely imposed through external regulations.

1.2.3 Value propositions in higher education

The traditional HE landscape is experiencing major changes due to an increase in the demand for education, environmental changes in the industry, technological and economic changes, globalisation, borderless HE, as well as changes in labour market requirements (Wehn et al., 2017:1).

HEIs are therefore required to re-examine their value propositions continuously to ensure they stay relevant and are sustainable, as well as satisfy the needs of customers in HE (Ibrahim & Dahlan, 2016:600). Business models provide an overview of how HEIs do business, guide the effective and innovative delivery of services and assist private HEIs in identifying and focusing on what their core value propositions are (Edralin et al.,

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1.2.4 Service quality in education

According to Sallis (2014:1), private HEIs are service providers which should focus on improving the quality of the service the institution provides. Van Schalkwyk and Steenkamp (2016:578) refer to the management and improvement of service quality as being a critical aspect in improving private HE and that it can be seen as the differentiating factor for success between private HEIs, but also between public and private HEIs. In this regard, total quality management (TQM) was found to play an important role in education and assist institutions to successfully deal with changes in the industry (Khan et al., 2018:182). Van Schalkwyk and Steenkamp (2016:578) also determined that TQM will assist institutions in achieving internal and external customer satisfaction. This is possible when looking at TQM as defined by Sohel-Uz-Zaman and Anjalin (2016:209) as a planned and systematic process that is used to ensure quality exist in the service delivery and that the service is continuously improved.

In addition to the above factors, Sutin (2016:18) mentions that it is important for organisations to adapt to changes that occur in the environment to ensure they meet the changing needs of customers and provide relevant value propositions. As private HEIs are private sector companies, “their survival relies upon knowing what business they are in and how it is changing”, taking into account “performance excellence, self-reliance, service quality and reliability, awareness of customer needs and customer satisfaction” (Sutin, 2016:21).

1.3 PROBLEM STATEMENT AND RESEARCH QUESTION

Although there is literature available on business models for HEIs, TQM in HE and the regulation of the HE landscape to ensure quality, there is a gap in current research regarding the effectiveness of the implementation of TQM and service quality in private HEIs. There is a need to determine whether the implementation of TQM in private HEIs supports these institutions in adapting their value proposition to satisfy the changing needs of students. Competition in the private HE sector is on the increase, and these institutions need to compete in new ways to ensure sustainability in the competitive environment that exists.

This study emanated from the researcher’s involvement at a private HEI, Akademia, and exposure to the private higher education sector, including involvement in the regulatory

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framework for the past 12 years. Akademia is a registered, non-profit private higher education institution, offering qualifications in Afrikaans. It is funded by private sponsors and student tuition fees. Akademia is instrumental in the unlocking and developing students’ ability and potential through the unravelling of new knowledge and skills through the medium of technology.

Programmes are taught through distance education, using the provision of comprehensive guidance on the Learning Management System (LMS) platform, which forms the core of the students’ digital workspace for distance learning. In addition to the independent teaching and learning interaction facilitated by purpose-designed interactive study guides, individual asynchronous online support is continuously provided to every student.

Akademia uses video conferencing technology as a secondary mode of delivery of teaching and learning, supporting and enhancing student participation in the teaching and learning situation. These video conferencing contact sessions are predominantly used to establish more personal contact between students and lecturers, and students amongst themselves. The contact sessions are used to explain and discuss more complex content issues and to allow students to participate interactively with the subject content.

This model allows Akademia to have the main campus with academic staff in Centurion and 13 other study centres across South Africa and Namibia. These study centres are facilities that are used during the videoconferencing interactive sessions, as well as during tests and examinations. The study centres are facilities equipped with appropriate videoconferencing electronic equipment and WiFi internet connectivity to facilitate full real-time interaction between the lecturer (in a studio at the main campus) and the student (at the study centre) during the contact session.

The focus of this study is to determine the influence of TQM on service delivery in a private HEI, and whether it provides the private HEI with a competitive advantage. Developed from the background and problem statement, the research questions raised are:

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• Research question 1: To what extent was the delivery of quality services in private HE ensured through the regulatory environment externally, and TQM internally, in Akademia at the time of the research?

• Research question 2: Can TQM assist Akademia in providing a quality service to students and guide the institution in staying relevant in the sector through being able to adjust the value proposition in time?

When considering the above, the research aims and objectives of the study will be addressed in the next section.

1.4 AIMS AND RESEARCH OBJECTIVES

The aim of the research is to gain a better understanding on whether service quality and TQM principles are used in a private HEI to guide the institution in changes that are needed in the value proposition to students, and gaining a competitive advantage through ensuring student satisfaction. This will be achieved through the following objectives.

• Research objective 1: To explore the quality mechanisms used by a private HEI and determine if adherence to an external regulatory framework supports the delivery of service quality.

• Research objective 2: To determine if TQM implementation assists a private HEI in adjusting the value proposition to gain a competitive advantage.

These research objectives informs the scope of this study as will be discussed in the next section.

1.5 SCOPE OF STUDY

The study will focus on principles of operations management and the value proposition aspects of business models. It will primarily investigate the private HE part of the HE landscape and how institutions in this part of the sector can differentiate themselves through service quality by focussing specifically on Akademia as a private HEI. The research method used for the study is outlined below.

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1.6 RESEARCH METHODOLOGY

This section outlines the methodology that was used in the research and which consists of two phases:

• Phase 1: Literature review • Phase 2: Case study

1.6.1 Phase 1: Literature review

The literature review was conducted through studying relevant documents that included prior research studies, relevant scientific journals, articles, policies, procedures and other documents that are relevant to private HE.

1.6.2 Phase 2: Case study

A qualitative research design methodology was deemed appropriate for the study and was used to understand the social phenomena being studied, by using evidence from in-depth interviews, document review and literature (Henning, 2018:3). The specific qualitative method used was an exploratory case study. The case study method allowed the researcher an in-depth understanding of the phenomena being studied, namely private HE in the relevant context, as the contextual conditions were one of the reasons the subject was chosen for the study (Yin, 2009:18). When there are identifiable boundaries to the phenomena being studied, the case study as a genre is favoured for a research method (Henning, 2018:41). This is the case with private HEIs and the reason the case study method was chosen. The identifiable boundaries were that the institution had to be a private HEI, must have been registered with the DHET and meet all criteria regarding the registration as private HE institution.

Through the case study, as an alternative interpretative approach, the research contributes to creating rich and holistic explanations of the subject matter and areas of enquiry as multiple methods of data collection that include document review, in-depth interviews and focus group discussions (Bryman et al., 2017:112). Data was analysed through pattern matching and identifying themes and subcategories. The data analysis was supported by using ATLAS.ti software.

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The case study was cross-sectional, as data was collected from the unit of analysis at one point in time and not over a period of time and thus provided information about the current functioning of the institution. Cross-sectional data refers to data that is collected at a given point in time from the unit of analysis, where longitudinal research collects the data from the same unit of analysis at different points in time (Bryman et al., 2017:107). 1.6.3 Unit of analysis

The unit of analysis for the research was a private HEI (Akademia), which is a real-life case study and relevant to the research questions that have been defined (Yin, 2009:30). The sample was heterogeneous and four managers across the top and middle management structure, as well as ten registered senior students, were included in the research study. All the participants were briefed about the research and the reasons they were chosen to form part of the study.

1.6.4 Data collection

Multiple data sources were used in the data collection process, which consisted of studying local and international academic sources to establish what has been published on TQM and service quality in the HE sector. Local content on these topics was very limited. Information was further collected on research themes that included an explanation of what the value proposition of HE was thought to be. Attention was also given to establishing the regulatory requirements for the South African HE sector and specifically private HEIs.

The single case study method, combined with in-depth interviews and focus group discussions were used for cross-checking and supplementing the data obtained from the literature and document review. The data was triangulated to ensure control over the factors that might influence the validity of the research conducted, and to provide a valid and reliable way in understanding the phenomena being studied (Bryman et al., 2017:45). Triangulation is defined by Cohen et al. (2000:112) as the use of multiple methods of data collection to strengthen research findings. The important component of validity in research was addressed through the honesty, depth, richness and scope of the data collected, triangulation, and the objectivity of the researcher (Cohen et al., 2000:105).

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1.6.5 Data analysis

The purpose of data analysis was to establish the relationship between the research problem and objectives and to reduce the data to interpretable formats that will assist in drawing valid conclusions from the interviews and focus group discussions. All interviews and focus group discussion were recorded with the consent of the participants and transcribed verbatim.

Reliability refers to the demonstration that different researchers will be able to replicate the outcome of the research conducted through using the same methodologies (Riege, 2003:81). Through establishing the relationship between the researcher and the interviewees and focus group members, reliability was ensured as the objective of the research, and the role of the sample group was established.

1.7 ETHICAL CONSIDERATIONS

In order to adhere to ethical issues, the treatment of participants was and important aspect of the research (Burke Johnson & Christensen, 2014:127). The ethical principles that were maintained throughout the research included (Bryman et al., 2017:120):

• obtaining informed consent from all participants;

• ensuring anonymity and confidentiality of participants and respecting their privacy; and

• ensuring no deception involved in the research process.

1.8 LIMITATIONS OF THE STUDY

This is a case study and limited to a specific private HEI, namely Akademia. The empirical study was also limited to information that could be gathered from the institution and its registered students. Further research should be conducted at other institutions nationally and internationally. Furthermore, a comparative study of research results would add value to understanding the HE environment in South Africa.

1.9 CHAPTER LAYOUT

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Chapter 1 provides the contextualisation of the study. The chapter deals with the introduction, background of the study, the problem statement, the research questions and research objectives, the research methods and design, keyword used in the case study, and chapter layout.

Chapter 2 comprises a focussed literature study, a review of previous research and opinions, as well as an interpretive summary of the current body of knowledge in terms of private HE, business models, core value propositions, total quality management, quality of design and student satisfaction and needs.

Chapter 3 outlines the methodology used to conduct the research and achieve the objectives of the research project. The chapter covers the research design, the population being studied for the research and its data collection methods.

Chapter 4 focuses on the results of the research. The analysed data is discussed based on the in-depth individual interviews and focus group discussions.

Chapter 5 concludes with a summary and conclusion of the results of the case study. The limitations of the study are discussed and recommendations for the future research addressed.

1.10 CHAPTER SUMMARY

Chapter 1 provided the background and context of the research, including the problem statement and objectives of the study. The literature review has been discussed and the chapter further explains the research design and data analysis techniques that were used, and concludes with a layout of the study.

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CHAPTER 2: THEORETICAL OVERVIEW

2.1 INTRODUCTION

The purpose of the literature review is to examine the current research and information available that is relevant to service quality and TQM in HE and its effect on Akademia. The purpose of the literature review is to serve as a point of departure in understanding the HE sector, and specifically the context of the private HE sector. It will also attempt to conceptualise terms such as “quality” and “quality assurance”.

The HE landscape in South Africa and how it has evolved over the last few years in regards to ensuring the quality of service delivery was identified as an important theme in the literature review. It also investigates the massification of HE and includes the concept of TQM and importance thereof in the service sector. As a result, the study will focus on the development of TQM in the service sector with reference to the HE sector specifically. These topics will be analysed and relevant conclusions drawn.

2.2 HIGHER EDUCATION IN SOUTH AFRICA

Within the South African education sector, the post-school sector consists of vocational and training colleges as well as HEIs. HEIs refer to both public universities and privately-owned higher education institutions where mainly academic qualifications – including higher certificates, diplomas, advanced diplomas, degrees – and research are the focus of the institution’s offering.

Public institutions are known as “universities” and private providers as “private HE institutions” according to legislation. Different private HEIs exist within the sector, including for-profit and non-profit institutions, institutions offering face-to-face contact and institutions offering programmes in the distance mode of delivery. Due to the massification of HE this sector also experienced significant growth, with an increase in the number of registered private HEIs currently competing in the sector providing HE access for students that are not accommodated by the limited capacity of the public sector (DHET, 2018; Stander, 2017:4; Van Schalkwyk, 2017:24; Thaver, 2006:860).

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2.2.1 Private higher education in South Africa

Private HE has been part of the education sector in South Africa since 1829 (Ellis, 2012:4). With the Constitution of the Republic of South Africa 108 of 1996 becoming law, HE was transformed with certain ground rules being determined for the whole education sector. Private HE was mostly unregulated until 1997 when the Higher Education Act was published, which through Section 53, regulates private HE to ensure academic offerings by private HEIs adhere to HE standards of quality (Ellis, 2012:17). There was a concern regarding the quality of education that was offered by private institutions in the sector prior to the publication of this act. Luckett (2007:98) highlights the following problems that existed in the HE sector when it was an unregulated sector:

• unequal standards of provision; • irrelevance of curriculum;

• curriculums being offered that were not aligned to the needs of the economy; • high failure and drop-out rates under students; and

• poor management of HEIs.

To assure quality throughout the education sector, external quality measures in the form of national policies and frameworks were introduced for both private and public HEIs. Private institutions that want to offer learning programmes that result in formal qualifications have to register as private institutions with the DHET and the purpose of the registration of these private institutions are (DHET, 2016):

• ensuring an acceptable quality of education is offered by the institution;

• protection of students through ensuring that the institutions have the necessary resources, capacity and expertise to deliver quality programmes before commencing with teaching and learning;

• ensuring the offering of qualifications are aligned to the national framework; and • working towards the transformation of the education sector as envisioned by the

government.

Private HEIs receive no funding from the government and are responsible for their own funding. According to Ellis and Steyn (2017:445), these institutions are predominately run as businesses and have to adapt to practices like accountability and efficiency in their

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operations due to changing needs of the market and students if they want to remain profitable and competitive.

The HE sector, like most other sectors within various economies, are facing major changes (Lichy & Birch, 2015:1). These changes include environmental shifts, changing economic situations, an increased demand for education and increasing real-cost of HE, technological changes and changes in stakeholder expectations to name but a few (Armstrong, 2014:1). Stander (2017:34) argues that private HEIs play a complementary role to public institutions due to the increase in demand for education. The strength of private HEIs are to be found in their ability to respond to specific market demands, not being bound by bureaucratic restrictions, and the flexibility to make changes to their business models. In the South African HE sector, there is a growing need for more post-school education and private HE can assist in satisfying the growing demand and work alongside public institutions, as the public HEIs alone cannot cater to the demand that exists (Van Schalkwyk, 2017:23). This increased demand and the changes experienced are creating the opportunity for private HEIs to relook their value propositions (Lichy & Birch, 2015:1) and ensure they stay relevant to their customers (Ibrahim & Dahlan, 2016:600).

2.3 QUALITY IN HIGHER EDUCATION

2.3.1 Background to external quality measures in higher education

There are varying definitions of quality, and in HE the distinction between the terms “quality” and “quality assurance” is also of importance. Stander (2017:1) argues that quality in HE refers to the quality of the learning that the student experiences, while quality assurance focuses on the assurance to stakeholders that the process of learning is adequate and credible compared to other institutions. Thaver (2006:862) notes differing views on what quality assurance means in HE, namely:

• adhering to a set of minimum standards which are critical to ensure quality in the institution;

• the establishment of uniform processes and structures that will ensure quality in the institution;

• ensuring transformation in HE; and

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The quality assurance in the South African HE sector is the responsibility of the Council for Higher Education (CHE) as per the National Qualifications Framework Act 67 of 2008. The NQF is a statutory body that was established in 1998 through the Higher Education Act 101 of 1997. The CHE, through the Higher Education Quality Committee (HEQC), is responsible for all aspects of quality assurance. Accreditation is one of the external quality assurance frameworks that the CHE developed and implemented to sustain the quality of HE. External quality assurance is therefore a mechanism used by the government to ensure greater efficiency and effectiveness in the HE sector (Luckett, 2007:98).

The HEQC is one of the main stakeholders (see Figure 1) in HE and responsible to externally promote quality assurance, audit the quality assurance mechanism, accredit institutions and develop quality-related capacity within the HE sector (CHE, 2004b:4). The development of quality-related capacity is an important function of the HEQC and is derived from the key strategy of the committee to work towards building the necessary capacity within HEIs to be able to move the framework towards institutions being adept at quality assurance so that self-regulation and self-accreditation by HEIs can be realised in the future (CHE, 2004b:7).

Figure 1 indicates the highly regulated environment in which HEIs – and specifically private institutions – have to function, and is an indication of the increased control government is exhibiting towards private HE. Almost all decision that are made by HEIs with regards to programmes that are offered and their mode of delivery are determined by set policies that HEIs have to adhere to (Van Schalkwyk, 2017:21). The primary responsibility to ensure quality should ultimately be the task of each HEI, as compliance to regulations are only a quality control measure, and the improvement of quality is driven from within HEIs (Sallis, 2014:7). Therefore the development, implementation and improvement of quality should be an internal process in HEIs, and supporting these institutions must be the focus of the CHE as the regulatory body responsible for quality assurance requirements in the sector (Stander, 2017:16).

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Figure 1: Legislative framework for private higher education institutions (Stander, 2017)

The following forms of external quality assurance are identified by Stander (2017:19): accreditation, audits, institutional reviews, standard setting and ranking. Stander (2019:20) state that standards are not all the same and that standards that are set are dependent on their contribution to an institution’s quality assurance. Standards are therefore not rigorous indicators of quality. Ranking as an external quality assurance form is linked to standards where strict assessment tools are used to quantify evaluations and decisions on institutional rankings (Stander, 2017:20). Further focus will be limited to accreditation as a form of external quality assurance as it is an effective form of professional control that relates to meeting minimum standards, accountability and transparency in processes of the institution and aims to enhance quality.

2.3.2 Accreditation as an external quality assurance measure

Accreditation as a quality measure has at the core the rationale of accountability and improvement of the quality that is offered in the HE sector (Stander, 2017:19). General accreditation criteria have been developed through a quality assurance framework, which specifies minimum standards that all programmes offered at the HEI have to adhere to.

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The purpose of the accreditation process is to ensure accountability and improvement in quality (CHE, 2004b:1).

The following table summarises the criteria that is used for accreditation and what the criteria requires of HEIs to meet minimum standards.

Table 1: Accreditation criteria (CHE, 2004c:6)

Minimum standards that have to be met for accreditation

Minimum standards for activities and processes which have an impact on the programme input and resources that are needed to offer the programme include:

• Programme design

• Student recruitment, admission and selection • Staffing

• Teaching and learning strategy

• Student assessment policies and procedures • Infrastructure and library resources

• Programme administrative services

• Postgraduate policies, regulations and procedures

Activities and processes which have an impact on the delivery of the programme include: • Programme coordination

• Academic development for student success • Teaching and learning interactions

• Student assessment practices • Coordination of work-based learning

• Monitoring of programme output and effectiveness

Activities and processes which have an impact on the monitoring of the programme output and effectiveness include:

• Student retention and throughput rates • Employability of graduates

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• Programme reviews

Stander (2017:4) determined that with the implementation of a programme accreditation framework in 2004, as well as the DHET regulating private HEIs more closely since 2002, the external focus on quality in HE has received more attention than in the past. Armstrong (2014:5) defines accreditation as

an industry-wide process defined and enforced by people who believe strongly in the definitions of excellence contained in the set of existing value propositions; the goal of the process is to assure that business model changes in HE are sustainable and serve to increase performance along the existing definitions of excellence.

Through accreditation, the market is assured that the qualifications offered by the private HEI are on standard. This is an external measure implemented to ensure the quality of the service provided by private HEIs to the broader public and society (Thaver, 2006:861). Luckett (2007:100) argues that there are four approaches to quality assurance in the HE sector (Figure 2) and that these approaches differ according to stakeholder views. The views of stakeholders differ in terms of 1) what the definition of quality is and who determines this definition, 2) by whom the criteria of evaluation are set and what their focus is in setting the criteria, and 3) what the envisioned result is in the setting of the quality standards. Figure 2 shows the tension between the power and control relationship of internal owners and external bodies (horizontal axis) and the purpose of assurance (vertical axis) that are present in the quality assurance process (Luckett, 2007:99). This viewpoint was confirmed in a study by Stander (2017:138) which concluded that different private HEIs have different views and definitions of the term quality and that the definition used by an HEI has an impact on how quality is assured in the institution.

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Figure 2: A conceptual framework to approaches in quality assurance (Luckett, 2007:98)

In quadrant 1, quality is defined as academic excellence and is based on peer reviews being conducted between institutions. The quality emphasis is therefore on the disciplinary excellence as opposed to good teaching of the discipline.

In quadrant 2, quality is defined through using the institution as the criteria, and good management through a central control approach is seen as the solution to achieving organisational effectiveness and efficiency. Therefore, management’s goals and objectives are the criteria used to measure the performance of the institution.

In quadrant 3, quality is measured through evaluation criteria that are generated by the external evaluators involved in the institutional evaluation process. The main viewpoint in this approach is that self-regulation is the correct approach to ensure quality and that HEIs can ensure quality offerings within the institution through benchmarking and involving the support of external peer reviewers.

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In quadrant 4, quality assurance is achieved through strong government interventions, with the purpose of quality assurance being accountability and control. This approach involves an external evaluation in which the criteria set are based on the government’s purpose and goals for HE. With this approach to quality assurance the same criteria and treatment are applied to all institutions in the sector and no allowance is made for differences in context between institutions.

This bureaucratic rationality quadrant is especially relevant to private HE in South Africa. Luckett (2007:98) argues that it is only an assumption that is made that external quality assurance in the HE sector will in effect lead to the improvement of the quality in the sector. Sallis (2014) confirms that although these external measures do have a place in ensuring quality, they are more quality controls and that quality improvement is more important and difficult to achieve. External quality assurance systems assist with the control of quality, but cannot affect improvement as external quality assurance only enforces compliance with the set criteria (Luckett, 2007:111). Quality improvement can only be effective if internally adopted by the institution and becomes a management approach which focuses on delivering service quality; ensuring quality in the sector will be determined by the development of capacity within institutions to implement quality in all area of their operations (Alani et al., 2014:232).

Van Schalkwyk and Steenkamp (2016:578) refer to the management and improvement of service quality as being a critical aspect in improving private HE and one that can be seen as the differentiating factor for success between private HEIs, but also between public and private HEIs.

2.3.2.1 Massification of higher education

According to Hornsby and Osman (2014:712) “massification of HE” is the phrase used to describe the rapid increase in student enrolments since 2010. Massification of HE affects the quality of HE (Thaver, 2006:861), and challenges the traditional view of universities being centres of so-called elite education that are only available to a select few (Hornsby & Osman, 2014:712) with institutions that now have to accommodate massive student enrolments (Thaver, 2006:861).

According to Hornsby and Osman (2014:712), the massification of HE can be contributed to governments using HE to:

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• address and resolve social and economic inequalities that exist in countries; • drive the government’s social justice agenda; and

• contribute to the public benefit through the assumption that graduates will earn higher salaries and therefore there will be an increased contribution in the form of tax revenues.

Thaver (2006:861) argues that with the massification of HE, the question is raised regarding the quality of teaching and learning that is offered at institutions. This is an aspect that Hornsby and Osman (2014:712) reiterate with a view that the drive for massification of public HE is not supported by a proportionate increase in human, financial and physical resources to these HEIs, which directly affects quality. Through the National Development Plan as proposed by the National Planning Commission (2013:59), the government is driving further increases in student enrolments with a vision to increase university enrolments by at least 70% by 2030. This massification challenges the quality of the learning environment and teaching and learning practices in public HEIs.

Massification and the inability of the public HE sector to effectively absorb the increased demand is contributing to growth in the private HE sector (Stander, 2016:24). Private HEIs are using this to their advantage, as these institutions can now differentiate themselves from public institutions by “providing higher education products and services to students that the public higher education sector is mostly unable to do” (Stander, 2016:139). Private HEIs can allocate the necessary resources to student support due to the business model they follow and their business and entrepreneurial approach (Miller

et al., 2014:266). Van Schalkwyk (2017:25) argues that a shift is needed in HE legislation

to accommodate private higher education institutions that have the capacity, infrastructure and expertise to alleviate some of the pressures on public higher education, without the over-regulation that is currently applied.

2.3.3 Internal quality measures in private higher education institutions

Internal quality measures refer to the implementation of internal strategies and processes by organisations that lead to the achievement of the organisation’s objectives and goals (Stander, 2017:16). Stander (2017:18) highlights the following as practices that form part of internal quality assurance in private HEIs:

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• development of quality assurance policies;

• the setting of standards within HEIs that guide decisions and actions; and

• development of performance indicators and benchmarks that are used in internal evaluations of an HEI in achieving its goals.

Van Schalkwyk (2017:280) argues that generic service quality models are not adequate and that HE, and specifically private HE, needs to use industry-specific service quality dimensions to ensure private institutions can deliver services that satisfy student expectations and needs.

The expectation from stakeholders (Figure 3) in the HE sector has moved towards expecting more quality in the form of improved performances, institutional effectiveness in operations, improved stakeholders’ satisfaction and market competitiveness, and that quality assurance in private HEIs is focussed on the student (as customer) and their satisfaction (Stander, 2017:22,139).

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Van Schalkwyk and Steenkamp (2016:3, 578) argue that service quality will ensure brand building and credibility of the organisation in the minds of consumers, but also note the value of service quality to institutions in laying the foundation for customer loyalty. This is confirmed by Sallis (2014:5), who notes that consistent quality of service builds confidence with customers. Hwang and Choi (2019:1) found that service quality is essential in HE. Sallis (2014:1) further lists various important sources of quality in education, but states that quality can only be developed and achieved if students’ needs as customers are put first and satisfied. Private HEIs should therefore focus on student satisfaction and ensure they adopt a consumer-oriented approach (Hwang & Choi, 2019:3). Stander (2017:139) found that private HEIs define quality differently to how public HEIs, and that quality assurance practices and processes in private HEIs are predominately focused on customers – and therefore student satisfaction. Due to private HEIs being operated as corporate businesses, fundamental business management aspects like total quality management form part of their day-to-day operations (Van Schalkwyk, 2017:29).

Van Schalkwyk (2018:7) defines service quality as “meeting and exceeding students’ expectations and perceptions by constantly rendering a reliable service that conforms to pre-determined requirements for which the student is willing to pay, resulting in tangible and intangible benefits”, a description seen as relevant to this study.

Total quality management as a management model has a place in HE, as quality increasingly makes the difference between success and failure and can be the differentiating factor amongst institutions in a competitive HE sector (Sallis, 2014:1). 2.3.4 Total quality management principles

Total quality management is defined by Heizer et al. (2017) as the “management of an entire organization so that it excels in all aspects of services that are important to customers”. Goetsch and Davis (2014) define TQM as the approach organisations adopt to do business by attempting to maximise the organisation’ competitiveness through continuously improving the quality of their service and processes. Therefore, with the implementation of TQM in an organisation, the organisation commits to continuously work towards excellence in all areas of the organisation to ensure customer satisfaction through offering quality service. Stander (2017:23) argues that quality control and quality

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assessment are systematic evaluations used to measure the service against a pre-determined standard and forms part of the operational working of the institution, where appropriate actions will be taken if the service does not comply with the specified quality standards (Al-Shafei et al., 2015:1).

HEIs have started to realise the importance of quality and are constantly improving thereon to stay competitive (Alani et al., 2014:231). Van Schalkwyk and Steenkamp (2016:578) state that the management of service quality, if based on TQM, will result in internal and external customer satisfaction in private HE. Van Schalkwyk and Steenkamp (2016:579) narrow this down further to not just quality, but to service quality specifically, and emphasise that private HEIs can create value by offering a service of high quality. 2.3.5 Total quality management in private higher education

Manatos et al. (2017:161) found that literature on HE indicates that there are three levels of quality management integration within institutions. The first is on the process level, secondly on the organisation level, and thirdly the existence of quality management principles within the institution. Al-Shafei et al. (2015:2) identified three dimensions of quality (Figure 4) in HE, namely that institutions perform their core functions (dimension 1) and through the process (dimension 2) followed in the performance of these HE functions, the output (dimension 3) of satisfied graduates is achieved.

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Figure 4: Dimensions of quality in higher education (Al-Shafei et al., 2015:2)

Where Al-Shafei et al. (2015) identify three dimensions in the service quality, Van Schalkwyk (2018) identified 30 dimensions of service quality and contributed to the development of a service quality framework that consist of five pillars that support service quality and are specifically focused on private HE in South Africa. The identified dimensions and pillars from the study are summarised in Table 2.

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Table 2: Service quality dimensions relevant to private higher education (Van Schalkwyk, 2018:199)

Quality input Customer emphasis Productivity and systems approach Reputational service leadership Quality output • Quality teaching • Application and registration • Accreditation • Continuous improvement • Benchmarking • Research • Student support • Customer-centred approach • Communication • Personal attention • Internal customer focus • Managing expectations • Administrative capacity • Cost • Technology • Operations management • Information management • Service quality standards • On-time performance • Faculty expertise and senior academics • Reputation • Leadership and top management commitment • Culture • Trust • Loyalty • Ethical practice • Employability • Practical application • Unique product offering • Contribution to society • Assessment, measurement and feedback

Customer satisfaction will be achieved if institutions continuously improve their performance through the use of quality management processes (Manatos et al., 2017:161) and the adaptation of the dimension of service quality in HE (Van Schalkwyk, 2014:199).

Private HEIs are part of a growing and rapidly changing environment with various challenges as well as opportunities. With HEIs offering a service, the quality of the service can distinguish institutions from competitors and provide a competitive advantage. Van Schalkwyk (2017:49) argues that through ensuring efficiency and being service-oriented, private HEIs will be able to survive in the highly competitive HE environment. Through the improvement of service quality by applying TQM principles, institutions can employ a service strategy that fosters a total commitment to the improvement of their service, which could lead to an increased market share (Van Schalkwyk & Steenkamp, 2016:581).

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For private HEIs to be able to take advantage of such a competitive advantage, it is important that they know their students and ensures their value proposition to the market satisfies the changing needs of students. It is therefore relevant to look into the value proposition of private HE.

2.4 VALUE PROPOSITION OF PRIVATE HIGHER EDUCATION

Various definitions of the term “business model” exist, with Newman (2015:8) concluding that a business model refers to how an organisation captures and develops the specific way in which they have designed their processes to create value for their customers. Edralin et al. (2018:79) reiterate this view with defining a business model as the understanding of an organisation’s unique value-creation logic that is observed through the business processes implemented to create value for stakeholders, which is a broader concept than just customers. Armstrong (2014:2) further identifies the four important components of a viable business model as:

• the value proposition of the organisation; • the resources of the organisation;

• the processes within the organisation; and • the profit formula of the organisation.

A business model provides a strong and shared holistic view to the organisation and all stakeholders, which allows for the analysis and combination of possible opportunities and insights with regards to how certain business model elements can be manipulated and changed to form new alternatives or enhance the value proposition of the organisation, ultimately leading to satisfying the needs of customers and stakeholders (Newman, 2015:8). Tian and Martin (2014:932) argue that the business model is not just focused on ensuring the profitability of HEIs, but also ensures ethical, transparent and sustainable activities are taking place within the institution.

For private HEIs, this means that they can align their institutional business models with their priority of transferring knowledge (Sutin, 2016:18). Van Schalkwyk (2017:155) further indicates that, due to private HEIs being business-driven, these institutions have the freedom to be creative, innovative and profitable through the business models they employ. This freedom must be seen in the context of the study from Miller et al. (2014:265) that discuss the environment in which private HEIs operate, and the importance of how

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various stakeholders are also continuously shaping these HEIs’ business models. This is due to each stakeholder group having different objectives and needs that must be satisfied by the institution.

The major stakeholders involved in the HE sector (Figure 3) are all external to the institution, but these external stakeholders are also the main drivers of business model changes within a private HEI. It is therefore important that HEIs understand the various stakeholder needs. These institutions are not operating in insolation, and although private HEIs have the freedom to be innovative in their business models, they are also limited through the regulatory environment they operate in, as well as also being influenced and shaped by various external stakeholders’ needs.

The business model of a HEI is determined by the following three elements (Miller et al., 2014:266):

• the activities performed by the institutions;

• how these activities correlate to form the structure of the institution; and • the actors involved in the various activities within the institution.

An example of a business model tool that can be used to provide a holistic view of institutions is Osterwalder’s Business Model Canvas (BMC). The BMC provides an overview of the four pillars which form the structure of the institution’s business model, namely product innovation, customer relationship, infrastructure management and financial viability (Newman, 2015:11). These four pillars support the four components of a viable business model, namely the value proposition, resources, internal processes, and profit formula of the institution as previously highlighted by Armstrong (2014). The product innovation pillar of the business model focuses on the sub-elements of the value proposition and targeted customer segments. This pillar can be utilised by private HEIs to ensure a competitive advantage as they can differentiate themselves through the value proposition that directly addresses the needs of the target market through innovation and continuously changing and adapting the institution’s business model due to external forces. The value proposition of HEIs for various stakeholders should be defined, and the strengths of the HEI communicated to all stakeholders (Tian & Martin, 2014:933) through the business model that is followed. The value proposition pillar is the area where private HEIs have the freedom to improve their service quality to ensure customer satisfaction. Newman (2015:9) states that the value proposition of the

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organisation is the reason customers choose one institution over the other because it satisfies a specific need that the customer has, or satisfies it in a specific way. For private HEIs, the value proposition is therefore a differentiating factor and important in the supporting of the HEI in developing its competitive advantage (Miller et al., 2014:266). Due to the changes experienced in the HE sector, combined with the growth in the last few years, private HEIs need to re-examine their business models – and more importantly their value proposition – to stay relevant and competitive (Wehn et al., 2017:3). These institutions have to use these changes as opportunities and determine ways to meet customer needs (Sutin, 2016:18) through focusing on the quality of service they offer (Van Schalkwyk, 2017:49) and ensuring customer satisfaction (Manatos et al., 2017:161). By focusing on the value proposition of the institution, private HEIs will be forced to look at the needs of their students, which will guide them on what their strategies and revenue models should be and ultimately result in a positioning tool that institutions use to distinguish themselves from other providers in the sector (Wehn et al., 2017:4).

2.4.1 The value proposition of private higher education

It is therefore important to focus on what the value proposition of private HE is. This will be discussed in the context of the two primary purposes of HE, namely to equip students with advanced skills for the workplace and to transfer knowledge and understanding of the world (Wehn et al., 2017:6).

The value of the service is defined by the customer, and this is also true in HE where the value and the associated changes required in value creation will be defined by students (Tian & Martin, 2014:939). This value should enhance their quality of life on the completion of their qualification (Wehn et al., 2017:6). Wenger (2015:1) supports the argument that HEIs should see students as customers, and argues that it is crucial to understand customer needs in terms of how they want to receive the service of education. The value of HE, according to Tomlinson (2018:713), is derived from HEIs’ goals of transferring knowledge to individuals to empower them; therefore the value of HE is self-formation, and cognitive and social development for the student. HE is able to produce economic value for students through ensuring the development of productive capacity within the student, but remains a future-orientated good because the investment in HE is made in the present with the value only being assessed by the long-term impact it will

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make in a student or graduate’s life (Tomlinson, 2018:717). Tomlinson (2018:715) argues that the service in the form of knowledge creation and transfer should not just focus on the immediate gratification of student needs in the form of employment after studies but ensure future value in the form of genuine transformation of the student’s life. Sutin (2016:23) further observes that HE is a service industry where institutional well-being is connected to the changing needs of students and where the students are unforgiving when institutions do not stay relevant.

The value of education is not tangible and the only experience regarding the value that the student will have during their studies will be the quality of the service students receive from the institution.

For this study, service is defined as the service delivered by the private HEI to students from the student’s first contact with an institution, therefore from application and registration at the HEI, through to completion of a qualification and graduation, finally becoming an alumnus of the institution.

Through in-depth knowledge of students’ needs and the profile of students, private HEIs can determine how they should structure the service they offer to students (Wehn et al., 2017:5). Armstrong (2014:7) is also of the opinion that the value proposition of customers is constantly changing, resulting in a further challenge and opportunities for private HEIs. Newman (2015:5) argues that the answer to deliver new value propositions is ensuring that private HEIs are able to innovate their business model.

Heizer et al. (2017:271) highlight ten determinants of service quality, and it’s important to note that nine of these determinants fall within the service process side for the institution. Van Schalkwyk (2017:119) expanded these dimensions to 30 that are relevant for private HE in South Africa. It is therefore important for private HEIs to ensure processes are designed to include these attributes and dimensions as a first step in determining their service offering when looking at their value proposition. For private HEIs, there is the added threat of strong competition within the private HE sector, as well as competing with a still functional public university offering which carries strong brand loyalty from society. The improvement of the quality of the service offered by a private HEI could be the key factor for success according to Van Schalkwyk and Steenkamp (2016:578). This is due

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thereby adjusting their way of offering the relevant programmes, but also demanding rigorous academic expectations and intellectual effort from students (Tomlinson, 2018:717). It is therefore important to ensure, monitor and develop quality within private HE to stay relevant and competitive within the sector.

2.5 CHAPTER SUMMARY

This chapter set out to review the literature regarding TQM and service quality in HE as part of the service sector. It began by looking at the HE landscape in South Africa and the growth and expansion of this sector, as well as the existence of private HEIs within this sector. The literature review regarding TQM looked at the principles of TQM in general, and concluded with service quality in HE and the significant effect it has on the value proposition of institutions. It was concluded that private HEIs can use service quality as a value proposition to attract students and gain a competitive advantage over public HEIs, due to the massification of HE and public HEIs experiencing problems with ensuring the quality of the service offered due to the massification trend. Private HEIs operate like any business in the economy and continuously face new challenges, but these institutions are able to seek alternative means to grow and compete in a highly competitive and regulated environment through their offered value proposition. Private HEIs can ensure a sustainable competitive advantage if they ensure quality management is implemented in all aspect of the service delivery to their students as customers.

The next chapter presents the empirical research, wherein the research methodology and results from the empirical study are presented.

The use of total quality management in the adaptation of quality of delivery: a case study in private higher education